Sutro Biopharma Announces Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

Sutro Biopharma (NASDAQ: STRO) announced that on December 15, 2025 its Compensation Committee granted 24,500 stock options and 2,000 restricted stock units (RSUs) to new non-executive employees as inducement awards approved under Nasdaq Listing Rule 5635(c)(4).

The awards are governed by the Amended and Restated 2021 Equity Inducement Plan. Vesting for the stock options is 25% at one year then monthly to the fourth anniversary; RSU vesting is 25% at one year then annually to the fourth anniversary, each subject to continued service.

Key Figures

Stock options granted 24,500 shares Inducement grants to new non‑executive employees under 2021 Equity Inducement Plan

RSUs granted 2,000 RSUs Inducement grants vesting over four years subject to continued service

Q3 2025 revenue $9.7M Quarterly revenue, up from $8.5M a year ago

Q3 2025 net loss $56.9M Quarterly net loss, larger than $48.8M a year ago

Restructuring charges Q3 $9.6M Restructuring costs recorded in Q3 2025

Restructuring charges YTD $49.0M Year‑to‑date restructuring charges in 2025

Cash & securities $167.6M Unrestricted cash, cash equivalents and marketable securities as of Sep 30, 2025

Nine‑month revenue 2025 $90.8M Revenue for nine months 2025 vs $47.2M prior year period

Market Reality Check

$10.96 Last Close

Volume Volume 63,658 is 58% of 20-day average 110,291, indicating subdued trading ahead of this filing. low

Technical Shares at $9.93 are trading above the 200-day MA of $8.81, reflecting a recovery from prior lows.

Peers on Argus

While STRO was up 1.02%, several close biotech peers were down (e.g., ENTX -4.15%, OKYO -5.5%), with only XBIT higher at +4.12%. This pattern points to stock-specific rather than sector-driven factors.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 03	Clinical trial start	Positive	+19.2%	First cohort dosed in Phase 1 STRO‑004 trial in TF‑expressing tumors.
Dec 01	Reverse stock split	Neutral	-12.8%	1‑for‑10 reverse split to regain compliance with Nasdaq bid price rule.
Nov 12	R&D day update	Positive	-0.3%	Virtual R&D Day outlining ADC platform, STRO‑004 progress, and pipeline plans.
Nov 06	Earnings and pipeline	Neutral	-4.3%	Q3 2025 results, STRO‑004 IND clearance, and cash runway into at least mid‑2027.
Nov 05	Conference announcement	Neutral	-3.5%	Announcement of virtual R&D Day focused on ADC innovation and pipeline.

Pattern Detected

Recent news has often produced asymmetric moves: strong upside on clinical progress but negative or muted reactions around financial updates and corporate actions.

Recent Company History

Over the past months, Sutro has focused on advancing its ADC pipeline and stabilizing its listing. A key milestone was dosing the first cohort in the Phase 1 trial of STRO‑004 on Dec 3, 2025, which coincided with a 19.21% gain. A 1‑for‑10 reverse split effective Dec 3, 2025 drew a -12.82% reaction. Q3 2025 results highlighted $167.6M in cash and an expected runway into at least mid‑2027. Today’s inducement grants fit into this backdrop of ongoing hiring and equity-based compensation.

Market Pulse Summary

This announcement details modest inducement equity grants—24,500 stock options and 2,000 RSUs—to new non‑executive employees under Nasdaq Listing Rule 5635(c)(4). The awards vest over four years and are part of Sutro’s Amended and Restated 2021 Equity Inducement Plan. In context, the company recently reported Q3 2025 revenue of $9.7M, a net loss of $56.9M, and cash of $167.6M with an expected runway into at least mid‑2027. Investors may track future filings for additional equity grants or compensation changes.

Key Terms

Nasdaq Listing Rule 5635(c)(4) regulatory

"approved by the Compensation Committee ... in accordance with Nasdaq Listing Rule 5635(c)(4)."

NASDAQ Listing Rule 5635(c)(4) is a rule that requires a company to get approval from its shareholders before selling a large amount of its shares, usually over 20%. This helps protect investors by making sure the company doesn't flood the market with new shares without their say, which could lower the stock's value.

restricted stock units (RSUs) financial

"granted stock options to purchase 24,500 shares ... and 2,000 restricted stock units (RSUs)"

Restricted stock units (RSUs) are a type of company promise to give employees shares of stock in the future, usually after certain conditions like working for a set time. They are like a gift promised today that you receive later, which can become valuable if the company's stock price goes up. RSUs matter because they are a way companies reward employees and can be a significant part of compensation.

antibody drug conjugates (ADCs) medical

"pioneering site-specific and novel-format antibody drug conjugates (ADCs)"

Antibody drug conjugates (ADCs) are specialized medicines that combine a targeted antibody with a powerful drug, designed to attack specific disease cells while minimizing harm to healthy ones. This approach allows for more precise treatment, often leading to better outcomes. For investors, ADCs represent innovative therapies with the potential for significant market impact and growth in the healthcare sector.

Equity Inducement Plan financial

"subject to the terms and conditions of Sutro’s Amended and Restated 2021 Equity Inducement Plan."

An equity inducement plan is a program that gives new hires or targeted employees stock, restricted shares, or stock options as a hiring or retention reward, often separate from the company’s regular long-term incentive plans. Think of it as a signing bonus paid in company stock: it helps attract and keep talent but matters to investors because it can dilute existing shares, change executive incentives, and affect future earnings through compensation expense.

AI-generated analysis. Not financial advice.

SOUTH SAN FRANCISCO, Calif., Dec. 16, 2025 (GLOBE NEWSWIRE) -- Sutro Biopharma, Inc. (Sutro or the Company) (NASDAQ: STRO), a clinical-stage oncology company pioneering site-specific and novel-format antibody drug conjugates (ADCs), today announced that on December 15, 2025, the Compensation Committee of Sutro’s Board of Directors granted stock options to purchase 24,500 shares of Sutro common stock and 2,000 restricted stock units (RSUs) to new non-executive employees. The grants were made as an inducement material to the employees’ acceptance of employment with Sutro and were approved by the Compensation Committee of Sutro’s Board of Directors in accordance with Nasdaq Listing Rule 5635(c)(4).

The stock options and RSUs are subject to the terms and conditions of Sutro’s Amended and Restated 2021 Equity Inducement Plan. One-fourth of the total number of shares underlying the stock options will vest on the one-year anniversary of the employee’s hire date and monthly thereafter until fully vested on the fourth anniversary, subject to the employee’s continued service with Sutro on each such vesting date. One-fourth of the total number of shares subject to the RSUs will vest on the one-year anniversary of the employee’s hire date and annually thereafter until fully vested on the fourth anniversary, subject to the employee’s continued service with Sutro on each such vesting date.

About Sutro Biopharma

Sutro Biopharma, Inc. is advancing a next-generation antibody-drug conjugate (ADC) platform designed to deliver single- and dual-payload ADCs that enable meaningful breakthroughs for patients with cancer. By fully optimizing the antibody, linker, and payload, Sutro’s cell-free platform produces ADCs that are engineered to improve drug exposure, reduce side effects, and expand the range of treatable tumor types. With unique capabilities in dual-payload ADCs, Sutro aims to overcome treatment resistance and redefine what’s possible in cancer therapy. The Company’s pipeline of single- and dual-payload ADCs targets large oncology markets with limited treatment options and significant need for improved therapies. For more information, follow Sutro on social media @Sutrobio or visit www.sutrobio.com.

Investor Contact
Emily White
Sutro Biopharma
(650) 823-7681
ewhite@sutrobio.com

Media Contact
Amy Bonanno
Lyra Strategic Advisory
abonanno@lyraadvisory.com

FAQ

What did Sutro Biopharma (STRO) announce on December 15, 2025?

Sutro granted 24,500 stock options and 2,000 RSUs to new non-executive employees as inducement awards approved under Nasdaq Rule 5635(c)(4).

How are the Sutro (STRO) stock options structured and when do they vest?

Options vest 25% after one year then monthly thereafter, fully vesting on the fourth anniversary, subject to continued service.

What is the RSU vesting schedule for the December 2025 Sutro (STRO) grants?

RSUs vest 25% after one year and then annually, fully vesting on the fourth anniversary, subject to continued service.

Under which plan were Sutro (STRO) inducement awards made?

The awards were granted under Sutro’s Amended and Restated 2021 Equity Inducement Plan.

Why were the stock option and RSU grants to new hires at Sutro (STRO) approved?

The Compensation Committee approved the grants as inducement material to the employees’ acceptance of employment and in accordance with Nasdaq Listing Rule 5635(c)(4).

Do the Sutro (STRO) inducement awards include executive-level employees?

The announcement specifies the grants were made to new non-executive employees.